Agriculture and ground water quality: A public policy perspective

Abstract

Agricultural production is an important source of ground water contamination in many regions of the U.S. Ground water contamination is the unintended side effect of actions by economic agents pursuing their interests within the legal framework established by current public policy. Under existing policy, agricultural producers do not have changes as noted to consider off-site effects of their decisions on ground water supplies. Given these policy rules, producers can be expected to cause such damage until their rights and obligations are adjusted by policy. The farmer is simply responding in a predictable manner to opportunities existing within the economic system. Possible rationales for government action to protect ground water quality include: 1) the existence of “third party” effects in the form of off-site damages associated with degraded water supplies; 2) overuse of an “open-access” resource; 3) society's desire to make conservative ground water management decisions to avoid the risks of contamination; and 4) individuals' demands for ground water protection even though they may not expect to directly benefit. Alternative policy instruments for ground water protection include taxes, subsidies, regulations and prohibitions, education, and public spending. Different policy approaches are being employed to address agricultural contamination of ground water. One policy approach emphasizes producers ' lack of accurate information and appropriate decision-making, and recommends educating farmers about how their profits can be increased by improved decisions regarding inputs. A second approach is to change the rules and incentives to compel or induce producers to act in a way that improves ground water quality. If ground water quality follows the pattern of most public issues, effective policies will be developed only as the cost of failing to act becomes known. Research and delivery of information on the costs of ground water protection and the costs of not protecting ground water are likely to be key factors affecting the formation of future ground water quality policies.